The re-sale value of a leasehold property in Littleover is impacted by how many years the lease has remaining. If it is close to or fewer than eighty years you should expect difficulties on re-sale, so it is recommended to arrange for a lease extension before buying. It is ideal to start the lease extension process when the lease still has 82 years unexpired so that a lease extension can be finalised ahead of the 80 year threshold. Current legislation enables Littleover qualifying lessees to an additional term of ninety years in addition to the existing term, at a peppercorn rent (no ground rent). The intention of the valuation is to arrive at an opinion of the amount payable by the lessee to the freeholder for the purchase of the lease extension.
It is generally considered that a residential leasehold with more than one hundred years unexpired lease term is worth roughly the equivalent as a freehold. Where an further 90 years added to any lease with more than 35 years unexpired, the premises will be equivalent in value to a freehold for decades to come.
| Lender | Requirement |
|---|---|
| Bank of Scotland | Minimum 70 years from the date of the mortgage. |
| Godiva Mortgages | A minimum of 70 years unexpired lease at completion for all scheme types apart from Lifetime Mortgages (Equity Release), which require a minimum unexpired term of 80 years at completion. |
| Lloyds TSB Scotland | Minimum 70 years from the date of the mortgage. |
| Santander | You must report the unexpired lease term to us and await our instructions if: 1. the unexpired term assumed by our valuer is between 55 and 82 years, but the actual unexpired term differs by more than one year (whether longer or shorter); or 2. the unexpired term assumed by our valuer is more than 82 years but the actual unexpired term is less than 82 years; or 3. no valuation report is provided However, we will not accept a lease where on expiry of the mortgage: (i) less than 50 years remain and all or part of the loan is repaid on an interest-only basis: or (ii) less than 30 years remain and the loan is repaid on a capital and interest basis We will accept a lease that has been extended under the provisions of the Leasehold Reform Act 1993 provided statutory compensation would be available to the leaseholder. |
| Royal Bank of Scotland | Mortgage term plus 30 years. |
Regardless of whether you are a tenant or a freeholder in Littleover,the lease extension lawyers that we work with will always be willing to discuss any residential leasehold matters and offer you the benefit of their experience and the close ties they enjoy with Littleover valuers.
In 2014 Hunter, came very near to the 80-year mark with the lease on his basement flat in Littleover. In buying his flat twenty years previously, the unexpired term was of little interest. As luck would have it, he realised he needed to take steps soon on Extending the lease. Hunter arranged for a lease extension just under the wire last April. Hunter and the freeholder subsequently settled on an amount of £6,000 . If he not met the deadline, the sum would have increased by at least £1,125.
In 2014 we were contacted by Mrs U Fournier who, having moved into a first floor apartment in Littleover in October 2011. We are asked if we could approximate the premium could be to extend the lease by ninety years. Comparative premises in Littleover with a long lease were valued about £176,200. The mid-range ground rent payable was £65 invoiced quarterly. The lease expiry date was on 27 April 2081. Given that there were 56 years outstanding we approximated the compensation to the landlord to extend the lease to be within £29,500 and £34,000 plus expenses.
Last Christmas we were phoned by Mr and Mrs. L Lewis , who completed a ground floor flat in Littleover in January 2011. We are asked if we could shed any light on how much (approximately) price would likely be for a 90 year lease extension. Comparable properties in Littleover with an extended lease were in the region of £242,600. The average amount of ground rent was £45 billed annually. The lease termination date was on 21 February 2092. Taking into account 67 years outstanding we estimated the compensation to the landlord to extend the lease to be between £11,400 and £13,200 exclusive of costs.